Profit for Hero MotoCorp’s second quarter fell 10% year over year to Rs. 716 crore

In contrast to the same quarter last fiscal year, operating revenue climbed 7.4% to Rs 9,075.35 crore during the quarter under review.

Advertisement

On November 3, Hero MotoCorp announced that its standalone net profit for the three months ended September 30, 2022, had decreased by 9.9% year over year to Rs 716 crore. The largest two-wheeler manufacturer in the nation had previously recorded a net profit of Rs 794 crore.

Operational revenue in the reviewed quarter climbed 7.4% to Rs 9,075.35 crore from Rs 8,453.40 crore in the comparable quarter of the previous fiscal.

In the most recent quarter, the company’s earnings before interest, taxes, depreciation, and amortisation (EBITDA) were Rs 1,038 crore, down 2.6 percent from Rs 1,066.4 crore in the same quarter last year. Its EBIT margin also decreased 120 basis points, to 11.4 percent from 12.6 percent.

In half-yearly terms, the company’s net profit for the first half of the current fiscal year (2022-2023) was Rs. 1,341 crore, while revenue increased by 25.3 percent to Rs. 17,468 crore.

In the meantime, the manufacturer recorded a 17% decrease in overall sales last month (October 2022) as compared to 5,47,970 units in October 2021, totaling 4,54,582 units.

The company’s dispatches to dealers in the domestic market were 4,42,825 units, down 16% from 5,27,779 units in the same time last year.

Commenting on the quarterly performance, Niranjan Gupta, Chief Financial Officer (CFO), said, “A healthy festive period demand across most categories and specifically in auto sector have demonstrated that the underlying propensity to spend has gone up. The consumer confidence is coming back , which augurs well for growth momentum moving forward.”

“Our results reflect our continued financial discipline, focus on cost savings and capital allocation on one hand, while ensuring premiumisation of our portfolio on the other. The Xtec Variants which have been launched across all key models have been received by the customers very well. We will continue to build presence in premium segment through multiple launches over the next few quarters,” Gupta said further.

According to the CFO, there may be some uncertainty in the playing field due to the global macro headwinds, thus managing it over the ensuing quarters will be crucial. “However, as the commodities cool off, and the rate cycle reaches its peak, the medium-term outlook for the Indian auto industry appears quite encouraging,” Gupta added.

On the BSE, Hero MotoCorp shares closed on Thursday, November 3, 0.15 percent higher at Rs 2,646.10 a share.